Validus launches claims portal that it says could save industry £750m

Validus-IVC has launched a portal for claimants and insurers that it claims addresses the dysfunction in the credit hire market and could save policy holders £10 per year.

The platform, Validate, is the first developed by the company for claimants and their representatives.

Validate tracks a claim from start to finish and parts of it can be made visible to third-party organisations such as engineers and body shops as well as insurers and claims handling organisations.

If claims organisations and insurers used the platform as a “clearing house” for credit hire, it would save the industry £750m per year, or about £10 per policy holder, chief operating officer Ed van Rooyen said.

In its 2012 report into the motor insurance market, the Office of Fair Trading estimated an extra consumer cost of £225m from credit hire, equating to an additional £10 on each annual motor premium.

Having insurers and claimant organisations use the same system would speed up the process and save money for all parties, Van Rooyen said. For example, an insurer’s decision to confirm indemnity is instantly visible to the claimant, who can take the next step.

The system also scrutinises the claim made by a credit hire company to test against limits for areas such as how long an engineer should take to assess the vehicle and for how long a vehicle should be on hire. It then suggests a lower settlement figure if the set time frames have been breached.

A pilot project with the claims handling team of one insurer improved operational efficiencies by 30%. “Before they were receiving spreadsheets, passing them to teams of handlers, consolidating them back into one sheet and going back to the claimant’s organisation,” Van Rooyen said.

Validus is offering the system free to claims handlers and is piloting the system with the claims department of six more insurance companies.

Validus plans to make parts of the Validate platform available to policy holders to see next year, which it says would satisfy the Competition Commission’s desire for customer visibility.

The Office of Fair Trading referred the private motor insurance market to the Competition Commission last year. Its market study found insurers of at-fault drivers had little control over the repairs and replacement vehicles provided to the non-fault driver. This lack of influence could enable the insurers of the non-fault driver and credit hire organisations to inflate the cost of replacement vehicles and repairs, it said.

Van Rooyen said: “A well thought out portal with transparency for both sides, where the claim could be seen at any time equally, removes conflict and delivers faster settlement and lower cost, ultimately benefitting the consumer.”

“It has been designed to handle third-party motor claims and associated losses, irrespective of whether they are submitted under a third party to insurer protocol arrangement or an insurer to insurer bilateral agreement”.